Andrew Giles (Scullin, Australian Labor Party, Shadow Assistant Minister for Schools) Share this | Hansard source

It isn't written in coal, but it may well have been in the first draft, Member for Chifley. I was struck by him saying:

…the personal income tax burden is carried by the few, not the many.

I really hadn't picked the Treasurer as a big Jeremy Corbyn fan, but this was a particularly unconvincing homage. It shows the smoke and mirrors, the cheap tricks, which characterise this government's approach to economic management: pretending to be on the side of those who are doing it hard while, in fact, putting the boot in yet again to Australians and their families who are doing it tough, who deserve a government which is on their side and a real plan to secure sustainable growth that is inclusive and is a bulwark against excessive inequality. I make the point here, as I try to in every contribution, that on this side of the House we think inequality of income, inequality of wealth more so and especially of power especially are bad in and of themselves, but we also recognise, as does just about every reputable economic body internationally, that excessive inequality is a brake on growth. It's about time this government looked at that if they are serious about doing something to kick-start our economy.

It is dangerous nonsense to suggest that the very wealthy, those at the top, people who earn incomes like those of us who sit in this place, are overburdened by the income tax system. It is a nonsense and it needs to be repudiated. It's also a nonsense to talk of the 'speed limit' of 23.9 per cent of tax to GDP. As a number of observers from pretty much right across the political spectrum outside of the Fountainhead faction have said, firstly, this is an arbitrary number. There's no science or modelling behind it. It doesn't really meaning anything other than a commitment to a desire to shrink the state and, in shrinking the state, to shrink those things which bind us together: our sense of what it means to be Australian, our sense of what it can mean to be Australian. We need a tax-to-GDP ratio that isn't expressed in a number. We need a number that is just right to support the services and make the necessary productivity-enhancing investments to drive our economy forwards and ensure that that growth is shared equally and appropriately. That's what we need. We need to be clear and hit on the head the misleading cant that somehow there is a magical relationship between a particular number in terms of tax to GDP and economic growth.

You don't have to go very far in looking around the world to find that there is a very poor correlation between these numbers. A number of developed economies similar to ours have a significantly larger tax-to-GDP ratio and have had comparable or better records of economic growth in recent years.

What we need in place of the measures in this bill other than those to give relief to people affected in the first tranche and people on middle incomes is a different conversation when it comes to tax, when it comes to tax and inequality and when it comes to tax and productivity. What we need to do is discard the deeply ideologically blinkered thinking that underpins this bill and replace it with a serious conversation, because we do need to have a serious conversation about income tax, but we can only approach that if the government are willing to enter into a debate, and that seems highly unlikely. The refusal to split the bill is quite striking and quite shocking to me.

This proposal to flatten the tax structure can't be allowed to pass for an argument for simplifying our income tax arrangements. We're all in favour of building a system that is easier to understand for ordinary Australians who don't have access to the sort of legal and accounting advice that enabled 50 or 60 people last year to turn an earned income of over $1 million to turn a taxable income into zero, for example. That's one of the challenges in creating a simpler and fairer taxation system. We don't need changes to our tax system in which the benefits flow so overwhelmingly to those who are doing reasonably well at the moment—people like members of this place. Sixty-two per cent of the benefits go to the highest-income earners. These are the wrong priorities just like the rest of the budget.

To return to where the member for Bruce was making his contribution: this isn't an economic plan. This does not amount to a vision for Australia that competes with that which has been articulated by the Leader of the Opposition and the shadow Treasurer. There's a void here on the government's side. They can't articulate a fairer and better future. They can't talk about the country they want to build and how they want to take Australians with them on that journey. They talk about optimism, but they have no optimism. If they did, they would be following Labor's example and investing in the best driver of productivity growth, which is Australians, and educating them, appropriately building them with skills for the future. Instead they are abandoning them and relying on tired, disproven and deeply unfair ideological prejudices in place of an economic plan.

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